SINGAPORE (Jan 26): The manager of Ascott Residence Trust (ART) has declared a DPU of 2.04 cents for 4Q17, unchanged from a year ago.
Revenue for the quarter grew 6% on-year to $134.5 million compared to $126.7 million previously, mainly due to additional revenue of $11.2 million from ART’s acquisitions in 2017, which were partially offset by the decrease in revenue of $3.3 million from its divestments.
The trust achieved a revenue per available unit (REVPAU) of $155 for 4Q17, an increase of 5% as compared to 4Q16.
Out of gross profit of $61.8 million for the quarter, 31% was contributed by serviced residences on Master Leases, 13% from serviced residences on management contracts with minimum guaranteed income, and more than half (56%) came from serviced residences on management contracts.
Unitholders’ distribution for 4Q grew 30% to $43.9 million from $33.9 million a year ago, mainly due to a one-off distribution of $6.5 million to unitholders recorded in 4Q17. This was in relation to the gain from the divestment of Citadines Biyun Shanghai and Citadines Gaoxin Xi’an in China.
A one-off realised foreign exchange gain of $11.9 million, arising from the repayment of foreign currency bank loans with the proceeds from ART’s rights issue, was also recognised in 4Q.
The latest set of 4Q results brings ART’s DPU for the year to date (YTD) Dec 2017 to 7.09 cents, down 12% from a restated DPU of 8.03 cents a year ago post the trust’s 11 April 2017 rights issue.
Looking ahead, the manager says it remains focused on delivering steady returns to unitholders and prudent in its capital management, while continuing to monitor the interest rate and exchange rate exposure of the REIT.
“ART continues to lead as the most geographically diversified and largest hospitality REIT in Singapore with an asset size of $5.5 billion. We will continue to lookout for accretive acquisitions in key gateway cities, and re-allocate our investments into higher-yielding properties to enhance returns to unitholders,” says Bob Tan, chairman of the manager.
“Approximately 81% of ART’s total borrowings are on fixed interest rates to mitigate against potential rising interest rates. Our gearing of 36.2% as at 31 December 2017 gives us comfortable headroom for future investment opportunities,” adds Beh Siew Kim, CEO of the manager.
Units in ART closed 1 cent higher at $1.26 on Thursday.
